【Earnings Highlights】
- Total revenue increased by 20.1% year-over-year to RMB 88.5 billion in Q4 2024.
- Core local commerce segment operating profit grew to RMB 12.9 billion with a 19.7% operating margin.
- Adjusted net profit reached RMB 9.8 billion for the quarter.
- Annual transacting users exceeded 770 million, with annual active merchants increasing to 14.5 million.

【Q&A Highlights】

Q1: How does Meituan assess the risks associated with AI technology shifts and what are the company's AI investment plans?

A: Meituan's AI strategy focuses on three key layers:

1. AI at Work:
- Integrating AI into daily operations to enhance employee productivity.
- Developed an in-house large language model called "Long Cat" for various internal tasks.
- AI tools have boosted employee productivity and improved customer service efficiency by over 20%.

2. AI in Products:
- Optimizing existing products and developing new AI-native offerings.
- Launched AI assistants for restaurants, travel, and reservations.
- Planning to introduce a more advanced AI assistant later this year covering all Meituan services.

3. Building In-house Large Language Model:
- Continuous investment in enhancing the "Long Cat" model.
- API call volume for Long Cat increased from 10% to 68% over the past year.

Additional focus areas:
- Investing billions in GPU resources to ensure adequate AI computing capacity.
- Exploring AI applications in robotics and autonomous delivery.
- Leveraging Meituan's physical infrastructure to connect digital and physical worlds in the AI era.

Q2: What are Meituan's expansion plans for Keita in the Middle East, and how should we project overseas expansion losses for 2025?

A:
- Keita has shown strong growth momentum in Saudi Arabia since its launch in Riyadh last October.
- Now operating in over a dozen major Saudi cities.
- Focused on food delivery as the foundation for potential future expansion into other services.
- Overseas investment in 2025 will be significantly higher than in 2024 to fuel growth and market share gains.
- Long-term profitability outlook is positive due to higher average order values and service margins in Middle Eastern markets compared to China.

Q3: How is Meituan balancing investments in new initiatives with shareholder returns given increasing overseas capital needs?

A:
- Meituan constantly reviews its capital allocation strategy for both new initiatives and shareholder returns.
- Some new initiatives like Meituan Select have undergone significant strategic adjustments to improve efficiency.
- The company remains committed to enhancing shareholder returns through share buybacks.
- Expected to repay around $1.5 billion USD convertible bonds and $750 million corporate bonds in 2025.
- Will maintain stable, sufficient offshore cash reserves while using share buybacks as the primary method for shareholder returns.

Q4: What are Meituan's strategies to drive further penetration and maintain growth in food delivery and Meituan Shopping?

A:
- Management remains confident in the growth potential of on-demand delivery, including food and non-food categories.
- Food delivery continues to attract new users, particularly younger demographics with higher initial purchase frequency and faster growth.
- Supply-side innovations like Pinghafen are attracting consumer demand and improving efficiency.
- Meituan Shopping maintains a faster growth rate than food delivery, with continued efforts to empower merchants and deepen collaborations with branded retailers.
- The company maintains a vision of achieving over 100 million daily orders for on-demand delivery.

Q5: What is the current competitive landscape for in-store business, and how is the Shenghuiyuan membership program impacting user retention?

A:
- Meituan expects strong growth momentum to continue in coming years for in-store business.
- Online penetration for broad in-store categories remains low compared to physical goods e-commerce, presenting growth opportunities.
- The company will continue driving online penetration and solidifying competitive advantages in this space.

(Note: The response to the Shenghuiyuan membership program's impact was not directly addressed in the provided transcript excerpt.)

Disclaimer: This earnings call summary is generated by AI and is for informational purposes only. Due to technical limitations, inaccuracies may exist. It does not constitute investment advice or commitments.